Latin American travel will be booming in the next few years, thanks to this year’s World Cup and the 2016 Summer Olympics. Are you ready to handle the influx of travelers?
Earlier in 2014, the World Travel Market Latin America expo that took place in Sao Paulo, launched a Travel Technology Region, bringing together some of the major players (like Google and TripAdvisor) in the travel technology business. This expo was designed to capitalize on some of the success a similar expo had in London at the World Travel Market, and both expos were bolstered by some of the internet’s giants.
Latin America has started being able to capitalize on internet platforms to boost the online travel side of the business. With the merger of La and Tam into the Latam Airlines Group, and the global economic recession continuing to heal, things are looking up. Surprisingly, the use of GDS is not as high as in other regions, and individual companies tend to be more likely to operate their own systems, mainly B2B and B2C.
The B2C boom is leading to more internet bookings, particularly from overseas. Case in point – one Chilean travel agency purchased its IBE technology from Ireland. Internet bookings will continue to be a growth market in the coming years as more and more people get online and travel companies improve their network infrastructure. However, B2B is also showing remarkable growth, connecting the airlines and allowing for better booking abilities, even with the low-budget airlines. The Global Business Travel Association expects that business travel will grow nearly 10% between 2012 and 2016.
In addition, larger scale companies are also setting up their own personal booking networks and B2B booking sites which connect to the airlines and allow for open contact with the airlines. Whether they purchase the technology or build it themselves from the ground up is up to the company; what is important is that this is happening, and allowing the growth and rebirth of the Latin American region economically.
Once one company develops their booking technology, the current trend is for that technology to be shared with others, or at least the purchasing capability. Some companies will end up merging or consolidating, but many companies are finding that they have better luck sticking with what has worked for them, giving them the ability to secure local exclusive contracts.
Experts agree that the biggest growth in the Latin American travel technology realm is going to be in B2B assets. One of the advantages this system has is that local agents can negotiate better local deals on hotels and other suppliers, thanks to the relationships they are able to form. This should not be done at the cost of losing out on international travelers, however, so some integrated technology platforms need to be included in any plan.
As an added bonus, full service agencies are less expensive than ones in the US, so Latin America doesn’t see such a wide price difference as would be found in North America, giving them an advantage in the market.
It’s an exciting time in the travel technology field, and Latin America is poised to be in the heart of it all.